– A BRIDGE TO DEVELOPMENT RESULTS IN
SUB-SAHARAN AFRICA

During its 15th Annual Meeting that was held on June 29, 2006 and hosted by the Government of Denmark, the Board of Governors of the African Capacity Building Foundation (ACBF) approved in principle the Foundation’s Strategic Medium Term Plan (SMTP II) for 2007-2011 and proposed a pledging conference for November 2006 for the mobilization of resources for the implementation of the Plan. The Plan, which will implement programs of a financing scenario with a resource envelop of US$350million, will take capacity building within the Foundation’s six core competency areas a step further. During the weeks ahead, the ACBF Secretariat will further refine the Plan to reflect additional comments that were made by the Governors.

SMTP II is veritably a bridge to development results in sub-Saharan Africa in the context of the Millennium Development Goals (MDGs) – the indicators of which have gained global acceptance as measures of progress in development and poverty reduction. The Plan provides a sound platform for all development stakeholders to collectively, systematically and effectively take on the continent’s core capacity needs that fall within the Foundation’s six core competency areas. The full implementation of the Plan is thus a challenge to African governments and the entire development community. It is a test of the applicability of the tenets of the March 2005 Paris Declaration on Aid Effectiveness and Donor Coordination. And it is a test of the level of commitment by African governments to capacity building.

SMTP II brings to a close the capacity building decade that was proclaimed by the African Union in July 2002 during the First Ordinary Session of its Assembly in Durban, South Africa. It therefore presents an opportunity to revisit commitment to capacity building by African governments. Evidence of this commitment was strong during the 15th Annual Meeting of the ACBF Board of Governors. Not only is the level of African participation rising, testimonies as to what is being achieved by the Foundation and what is working, provided a refreshing confidence platform for the implementation of SMTP II. There is nonetheless opportunity for improvement: African governments will need to extend the ownership frontier of the continent’s capacity building efforts to re-kindle the valuable and commendable support that the continent’s development partners have so far provided through the Foundation to develop and strengthen capacity required by Africa to show results in the battle against poverty and other development challenges confronting the continent. Africa must show positive results by 2015, when the MDGs come up for assessment. The prospects are promising, but the challenges are still formidable.

The growth rate of Africa’s economy was projected at about 4.1% in 2005. This represented a slightly lower rate relative to the 4.4% recorded in 2004, with virtually all countries recording positive growth rates. Modest but encouraging results from the implementation of poverty reduction programs; growing improvements in political governance, which is reducing violent conflicts; strengthening macroeconomic policy environment; growing positive trend in the inflow of external resources - official development assistance and private foreign investment; and an encouraging progress in intra-regional trade are some of the fundamentals in the expansion of growth that has occurred since 2004. Nonetheless, the number of Africans living on US$1 a day has not declined. With more than 314 million people leaving on less than US$1 a day, about half of the continent’s population is therefore in extreme poverty.

The grim situation facing the continent is still far from easing up: some 34 of the world’s 48 poorest countries and 24 of the 32 countries ranked lowest in the UNDP human development report in 2005 are on the continent, where malaria and HIV/AIDS kill more than 2 million people a year. Even some of the strong performing countries are not spared. In sub-Saharan Africa, conflicts (which are now easing up), severe droughts, diseases and poor economic performances have caused millions of people to become even poorer than they were before the MDGs were adopted as development benchmarks.

Violent conflicts are receding on the continent and will soon become an occurrence of the past. They had in the recent past affected about one-third of the continent’s countries, and were estimated to reduce annual economic growth rate by about 2 percentage points. A reduction in conflicts is therefore a pre-condition for growth on the continent. Besides the preservation of productive resources, which results from abating conflicts, a reduction in conflicts has enormous salutary effect on skills retention, the promotion of a conducive environment for investment, and the reduction of incentives for illegal trade in commodities such as oil, gas, diamonds, timber, and precious metals.

Mrs. Ulla Tømæs, Minister of Development Cooperation of the Kingdom of Denmark, addressing Members of ACBF Board of Governors at a welcoming reception held by the Government of Demark for the Board.

It is on record that about fifteen African countries achieved an average economic growth of 5% per annum over the past decade. This is a success story. It is however not enough to offset the continuing fall on the continent’s share in world trade. With 15 landlocked economies and a gross domestic product that is about the size of Belgium’s, the continent just must make regional integration work. The promotion of regional trade, improvement of access to international markets, enhancement of trade negotiations capacity, strengthening of regional approaches to HIV/AIDS, private sector development, and the development of regional infrastructure remain crucial areas for intervention in capacity building and development financing.

Of the total global flow of US$135 billion in foreign direct investment in 2003, Africa received only US$9billion. This rose to about US$14 billion in 2004 – a signal that the investment climate is improving and is capable of attracting foreign investors. This improvement must be sustained through the gains resulting from the political governance front and the gradual, but encouraging growth in the private sector. Nonetheless, much is still to be done: the private sector is yet to be in the position to effectively serve as an engine of growth. The sector can only fully realize its potentials as an engine of growth and job creation, if the discernable success in political governance reforms are consolidated. These reforms have the potential of raising the level of attractiveness of the continent to domestic and foreign investors. The African Peer Review Mechanism (APRM) and efforts at strengthening corporate governance must therefore achieve results, if the investment climate is to be improved substantially.

The continent needs good governance in all its ramifications and substantial inflow of aid, if it is to attain an annual growth rate of 7% required to achieve the MDGs. Aid to the continent will improve in real terms, if the March 2005 Paris Declaration is effectively implemented. Also required is the need for donors to honor the promises they made in 2003 at the Monterrey Summit to increase assistance by US$12 billion a year and to fulfill the commitments they made during the July 2005 Summit of the G8 in the context of the report by the Commission for Africa to raise that increase to US$25 billion a year, and walk the promise of up to $55bn worth of debt relief as well as achieve the EU member states’ pledge of doubling aid by 2010.

What is evident from the foregoing is that the continent is still faced with enormous development challenges, which require systematic and sustained intervention in human and institutional capacity building. By implication, SMTP 2007-2011 will be faced with a broad range of capacity building issues to which the continent direly needs a sustained response. The implementation of the Plan is thus a major challenge to all stakeholders – African governments, private sector, civil society and the continent’s development partners. For the continent to show development results by, the capacity needs associated with the development challenges outlined above must be addressed. SMTP 2007-2011 provides a means for addressing some of these capacity needs. It is a bridge to the results that the continent so direly needs. All of us have a role to play in strengthening and using this bridge to deliver development results. Let us play our role – and effectively too.